1. Drivers of the New
Transmission System
CLE International
Ritz Carlton, Denver
March 19, 2010
by: Ron Miller, P.E.

2. RE Project Ingredients
• Environmentally-permittable
• Technically-feasible
• Financially-viable
… and the linchpin of any utility-scale project
is TRANSMISSION of energy to the end-
user market
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3. Market Drivers
• U.S. electricity demand, coal
consumption, & electricity
prices
• Renewable resource location
• Federal direction
• State renewable portfolio standards
• Price convergence
• Transmission use and constraints
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4. U.S. Electricity Demand, Coal
Consumption, & Electricity Prices
• Key electricity consuming areas:
Texas, California, Midwest
• Key coal consuming areas for
electricity: Texas, Midwest, Southeast
• Highest prices for electricity: Northeast,
California, Texas
These key criteria define the “target market”
for future renewable energy destinations
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5. Electricity Consumption
High energy
demand areas
Source: National Priorities Project Database
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6. Coal Consumption
High coal,
NOX, SOX,
CO2
Source: National Priorities Project Database
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7. Average 2008 Residential
Electricity Price in U.S.
High
energy
price
areas
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8. U.S. Residential Electricity Price
Historical Trend
Growing energy use/price, even with DSM/energy efficiency
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9. Renewable Resource Location
• Wind in Intermountain / Great
Plains area, California
• Solar in desert Southwest
• Geothermal in Nevada, California
• Best resources tend to be in
more remote locations, not
near major population centers, areas of
highest coal use, or areas with highest
electricity prices
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10. U.S. Wind Resources
Source: NREL
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11. U.S. Wind Potential
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12. U.S. Solar Resources
Source: NREL
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13. U.S. Geothermal Resources
Source: NREL
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14. Federal Direction
• Ensure that 10 percent of the nation's
electricity comes from renewable
sources by 2012 and 25 percent by 2025
• Implement an economy-wide cap-and-trade
program to reduce greenhouse gas
emissions 80 percent by 2050
• Reduced GHG in tandem with retiring coal
plants opens a window for alternative
sources for energy mix, if it can be
delivered to the end-user market
Copyright© 2010 Ronald L. Miller. Material can be shared or copied with attribution to
the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 14

15. Renewable Portfolio Standards
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16. Price Convergence
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17. Grid Use
• Grid built to handle transmission &
distribution needs for a utility’s service
territory with ties to only adjoining
utilities
• Never intended to handle cross-country
transmission of energy
• Transmission investment and rate of
return have historically lagged generation
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18. Current U.S. Grid
Source: Global Energy Decisions, LLC, June, 2008
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19. National Extra High-Voltage
Overlay Proposal
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20. Transmission Issues
• According to North American Reliability
Council new generation supplies are
forecast to outpace transmission,
constraining wind development with a
planned 145,000 megawatts of capacity
over the next 10 years
• Generation growth over 10 years: 21%
• Transmission line growth over 10 years:
10% with 1,700 circuit miles
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21. Transmission Solutions
• Texas approved a $4.9 billion transmission
system upgrade moving power from West
Texas to major population centers.
Capable of transmitting 18,500 MW of
wind power. Cost: $4/month/retail
customer
• National upsurge in transmission investment
due to Congressional action to increase
transmission project allowed rate of return
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22. Our Problem
High energy demand
& prices
Renewable resources
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23. One Possible Future Solution
High voltage transmission
High energy demand & prices
Renewable resources
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24. Value
• North / South grid allows leveraging
natural variability of wind throughout
Great Plains and complementary solar,
just as a portfolio of different stocks
lowers overall volatility
• East / West grid allows delivery to the
target markets with greatest value to
producers and producing states
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25. Kinder Morgan Rockies Express
• Natural gas pipeline from Cheyenne, WY to
Clarington, OH
• Limited “off-ramp” to deliver gas to
ultimate destination, connecting market
with discounted gas prices (CO) to one
with premium prices (East Coast)
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26. Kinder Morgan Northeast Express
Natural gas pipeline Clarington, OH to
Linden, NJ
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27. Summary
• Environmental concerns are leading
generation source changes
• Renewable resources need connections
to end-user electric markets which offer
higher prices to spur renewable growth
• Price convergence will multiply the need for
transmission to accommodate renewable
energy generation
• Energy storage will dampen RE variability,
adding greater reliability and value to its
generation
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the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 27

28. Summary, cont’d.
• Choice between less-productive, local
renewable resources vs. highly-productive
resources connected to high-demand,
high-priced markets
• Currently, intermediate states can derail
renewable generation and its multi-state
transmission to demand centers
• Need to incent the intermediate states to
gain from transmission, not just producer
and end user
Copyright© 2010 Ronald L. Miller. Material can be shared or copied with attribution to
the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 28

29. Summary, cont’d.
• To harvest best resources with economies
of scale, national extra-high voltage
transmission system similar to interstate
highway & natural gas pipeline system
is needed
• Combine different RE technologies whose
energy production profiles are
complementary to improve transmission
asset utilization and project rate of return
Copyright© 2010 Ronald L. Miller. Material can be shared or copied with attribution to
the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 29

30. Contact Information
Ron Miller, P.E.
303-723-5465
303-748-3441 cell
ronmiller74@comcast.net
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the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 30

31. Questions and Answers
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